First Merchants Bank will open five new branches or loan production offices in low- to moderate-income communities as part of a $1.4 billion community investment plan with the National Community Reinvestment Coalition.

The new locations will be established in Marion and Lake counties and in Franklin County, Ohio and Wayne County, Michigan.

In addition to a $10 million investment for the locations, the commitment focused on underserved, low- to moderate-income and rural communities will extend through 2025 and will provide:

• $398 million in mortgage lending

• $423 million in small-business lending

• $580 million in community development lending and investment commitments

• $3.4 million in sponsorships, grant, loan and investment opportunities

“The $1.4 billion Community Benefits Agreement accelerates First Merchants’ leadership in helping our communities and customers thrive,” Mike Rechin, First Merchants CEO, said in the announcement.

“At a time when low- and moderate-income neighborhoods are most vulnerable, we will provide hundreds of millions of dollars to help communities throughout Indiana, Ohio, Illinois and Michigan. The impact of these resources will last well into the future.”

With philanthropic funding a major part of the collaboration with NCRC, its development involved the collection of critical input from 19 locally based community organizations, the announcement said.

“This agreement is a product of all of our efforts. This commitment provides First Merchants Bank an opportunity to increase its Community Reinvestment Act activity, and to direct it where it is needed most,” Jesse Van Tol, the coalition’s CEO, said in the announcement.

“This is how the Community Reinvestment Act should work for banks and communities alike.”

Partnerships the bank has developed with the community-based organizations will help it identify and engage potential clients who could benefit from new and existing First Merchants products and services.

“The Community Benefits Agreement is an opportunity for the employees of First Merchants to take great pride and engage in … assisting those who most need an opportunity to build financial stability,” Karen Evens, First Merchants marketing director, said in the announcement.

“This agreement with First Merchants Bank is a significant step forward and reflects practices that all banks can adopt in order to address the racial wealth divide,” Dedrick Asante-Muhammad, the coalition’s chief of race, wealth and community, said in the announcement.

The collaborative initiative that began with a needs assessment last September was finalized about a year after the bank’s Muncie-based holding company, First Merchants Corp., announced important measures to boost mortgage lending in majority-black neighborhoods of Marion County.

The measures announced a year ago reflected a resolution of lending concern allegations raised against First Merchants by the Fair Housing Center of Central Indiana.

The bank denied any fault as part of a settlement with U.S. Attorney’s Office for the Southern District of Indiana and the Department of Justice after they filed a discrimination complaint against it.

PNC funds social justice programs

PNC Financial Services Group, Inc. has committed to more than $1 billion in support of efforts to end systemic racism and economically empower African Americans and low- and moderate-income communities.

“We are living in one of the most important civil rights movements of our time. Each of us has a role to play in combatting racism and discrimination, and PNC is committed to driving real change in areas in which we can make the greatest impact,” William Demchak, chairman, president and CEO, said in an announcement.

The expanded commitment provides more than $50 million in additional funding for local and nationwide social justice programs that help eliminate systemic racism and for workforce development and financial education programs.

The extra money also will fund affordable housing and neighborhood revitalization projects, with its allocation led by the board of the PNC Foundation as well as PNC’s regional presidents and community development banking teams.

“This is about PNC doing what it does well – putting our capital to work in the communities we serve and providing innovation through products and services, with a special focus on helping African Americans buy homes, which we recognize is an important factor in wealth accumulation,” Demchak said.

“We are also going to make a positive impact through employee volunteerism. We’ve seen incredible success from our employee volunteerism through our Grow Up Great program, and that’s what we’re going to do here as well,” he said.

The commitment includes more than $1 billion for employee volunteerism, nonprofit group support and community development financing for neighborhood revitalization and consumer and small business development.

The nonprofit group support will fund their economic empowerment and social justice programs and PNC employees will receive up to 40 hours of paid time off each year to do volunteer work with the programs.

“Today’s announcement is just one step toward PNC furthering its commitments and building on the meaningful work that the company has done in this space,” Demchak said.

“Diversity and Inclusion are fundamental tenets of PNC’s culture,” he said. “We are also committed to an intensified focus on the recruitment, retention and advancement of African American talent; a more comprehensive and sustained effort to create a more inclusive culture at PNC; and a focus on internal systems to improve racial equality.”

Within PNC, everyone has engaged in more candid, transparent and difficult conversations about changes needed to reduce the challenges faced by black employees and customers, he said.

“We have a responsibility to act — a responsibility to each other, our clients, communities and shareholders,” Demchak said.

“We need to seize this moment and use our voices, our influence and our resources to address racism, discrimination, bigotry, bias and economic and health disparities that plague our country.”

Seizing the moment includes recognizing democracy’s role in the fight for social justice, which Demchak said is why PNC contributed $200,000 earlier this month to the Lawyers’ Committee for Civil Rights Under Law to support its work to ensure minority voting access.

PNC has an extensive history of supporting economic empowerment and has earned “Outstanding” ratings under the Community Reinvestment Act since its examinations started more than 40 years ago, he said.

Lincoln funds HFH meat processing

Lincoln Financial Foundation has donated $1,250 to offset processing fees on livestock donated to Allen County food assistance agencies.

COVID-19 business disruptions put thousands out of work in Allen County and many of those families have been struggling to buy groceries, Lincoln said in an announcement on its donation to Hoosiers Feeding the Hungry.

“Hoosiers Feeding the Hungry has a unique opportunity to reduce food insecurity by receiving 500 donated pigs per week,” Debra Treesh, the nonprofit’s executive director, said in an announcement.

“The average cost to process a pig is about $200.00 so that is $100,000 per week that we will need to raise. We are so thankful to have a partner like Lincoln Financial Foundation, who is committed to helping us meet our community’s needs right now.”

The foundation is the philanthropic arm of Lincoln National Corp., an insurance and financial services company that does business as Lincoln Financial Group with a headquarters in the Philadelphia area and annuities operations based in Fort Wayne.

“We are committed to responding to the needs of our communities facing hunger,” Amber Zecca, HFH fund development director, said in the announcement.

“The funds provided will pay to process about 1,550 pounds of donated livestock – providing over 6,200 more meals through area hunger-relief agencies. A meal provided to a person in need means reduced hunger and increased disposable income. Right now, this is so important.”

Horizon prices subordinated notes

Horizon Bancorp, Inc. planned to issue $60 million in fixed-to-floating-rate subordinated notes due 2030 at 100% of par with an initial fixed interest rate of 5.625%.

The rate on the notes would reset quarterly to a floating rate equal to a benchmark rate expected to be the three-month Secured Overnight Financing Rate plus 549 basis points.

The notes would mature July 1, 2030, and the Michigan City-based parent company of Horizon Bank said it planned to use the proceeds for general corporate purposes.

The notes were intended to qualify as Tier 2 capital for regulatory purposes, and the offering was expected to close June 24.

Veteran reporter Doug LeDuc joined Business Weekly in 2006 and primarily covers banking and finance and technology. You can send information for his weekly column to dleduc@kpcmedia.com or call 260-426-2640, ext. 3309.

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